Political Risk

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Political Risk

The risk that a foreign government will significantly alter its policies or other regulations so that it significantly affects one's investment. More broadly, it can apply to the risk that a nation will refuse to comply with an agreement to which it is a party, or that political violence will hurt an investment or business. For example, if one exports goods to a foreign nation, and that nation elects a new government that enacts protectionist tariffs, this will negatively impact the export business.
References in periodicals archive ?
Companies with global investments, global markets or global supply chains need to undertake a process of identifying their political risks and deciding how to mitigate them, Wilkin suggests, using a five-step process.
For example, "the current iron ore rush in Liberia, Sierra Leone and Guinea is seeing South African companies pouring idle plant and machinery into the region," says Tracy de Kock, manager: New Business, Credit and Political Risks at Alexander Forbes.
This book focuses on understanding the political risks of various international regions, how PRI comes into play, and what agencies oversee its costs and uses.
Such events caused managers to become concerned with political risks especially when doing businesses overseas.
Moreover, some political risks may be related to the behaviours of MNEs, which cannot be forecast depending on external political risk assessment.
He will report to Don Asadorian, Senior Vice President of Political Risks and Trade Credit, within Ironshores global Political Risk platform.
This makes it more important than ever for global businesses to understand and mitigate their exposures to political risk," said Sarah Taylor, Aon Risk Solutions' executive director and head of structured credit and political risks.
Many investors may be disappointed by the President's recent controversial pronouncements, but a prolonged weakness in the market could not be driven only by perceived political risks.
Work with you insurance advisors to understand your specific political risks.
dollar and a slump in commodity prices together present a drastically different, less benign environment for developing countries, where some will struggle and classic political risks are likely to re-emerge as a concern for trade and direct investment," Kay said.
I'm reasonably convinced that, when top management thinks about identifying and controlling the political risks likely to affect its business, information professionals are not top of mind.

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